If Tube drivers are paid too much, don’t blame capitalism or the free market

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If you think Tube drivers are overpaid, you don’t understand how capitalism works.

That’s what Stephen Bush says in the New Statesman anyway.

Even by London standards, Tube drivers do earn a fair whack. The starting salary is just a few pounds shy of £50,000 a year and that can rise to £60,000 once you’ve got your feet under the table. Other perks include a 36 hour week and 48 days of paid annual leave. Compare that to an average wage for Londoners of £35,000 and you can see why some would think Tube drivers are overpaid.

Stephen points out that there are plenty “left-wing arguments” why Tube drivers are paid so much, but he’s found an even better “right-wing” one. Capitalism.

There’s no such thing as an overpaid worker in a capitalist society. There’s just what the market decides people are worth. Tube drivers have something almost everybody in London wants, are difficult to replace and do a job not many people want to do.

Apparently, if you don’t get that, you don’t get capitalism, but something tells me that it’s Stephen Bush himself that doesn’t understand how capitalism works.

Capitalism is an economic system in which capital goods are in private or corporate ownership, investments are made by private decision, and where the prices, production and distribution of goods and services are determined by competition in a free market.

Love it or loath it, that’s what capitalism is, and how anyone can square capitalism with how London Underground operates beats me.

Capitalism did give us the London Underground, and it remained entirely in private hands until the 1930s, but in 1948 it was nationalised and has remained in public hands ever since. The current operator, London Underground Limited, is a wholly owned subsidiary of Transport for London, the statutory corporation responsible for most of Greater London’s transport network. Transport for London is, in turn, a local government body subsidised by the taxpayer to the tune of three billion pounds a year and controlled by a board whose members are appointed by the Mayor of London. In short, about as close to a capitalist enterprise as West Ruislip is to Epping on the Central line.

It is true to say there is no such thing as an overpaid worker in a truly capitalist society, but Tube driver jobs are not available on anything like a free market basis. Wage rates are thrashed out between a state run business and trade unions. And thanks to a deal between Transport for London and the drivers’ union, ASLEF, any vacancies for drivers are filled by people already working for London Underground. Jobs are only offered externally when posts remain unfilled and in practice that means not very often. This actually means we have no real idea if it’s a job many people want to do or not, but at £50,000 a year, I’d be genuinely surprised if there was a shortage of takers.

And what exactly is it that Tube drivers have that everybody in London wants? They don’t own the London Underground or the trains they drive. If they did, they would be, er, Heaven forbid, capitalists.

Now there’s an idea.

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